Self Employment to Employment. Explaining to current family.

[BumpBirthBaby]

Dear all,

I began with Family 1 a year ago as a Maternity Nurse through a reputable London Nanny Agency, I was working 24hrs a day, 5 days a week and would invoice the families accountant and be paid that way.

It was only ever meant to be for 3 months, and I ended up staying longer and longer, days went down to 3 mid year (my choice) and then I agreed to stay on permanently for the 3 days.

I phoned the agency and I do know they charged the family a new fee for a permanent nanny, but the agency stated there were ways "I could get around being self employed still". Upon research I thought this to be bad advice, however continued on with the family and did not discuss it.

I am however the one that appears to have drawn the short straw surely? I do not see any benefits to me being self employed, when technically I should be an employed part time nanny. I work set days and set 24hours. With the weekly invoice being the same price plus expenses.

The only benefit I see is extra hours/days worked can simply be charged at my rate with no need for conversation re money (which I hate doing!!)

I don't get to choose my days I work, and asking for any time off I always feel guilty asking, as comments such as "I am sure that will be ok, we will discuss it later" and I haven't had the correct amount of time off this year in total with regards to my working days and of course all was not paid holiday.

I do however charge extra for extra hours, at £12 per hour (London Gross), double for bank holiday (not sure how this would work if I was employed by them) and I often do lots of overtime such as travelling away with them, and proxy parenting where the child stays with me (or me with them but they're away) so the rate is not £140 due to not getting any time off during the day in return for nights.

Could people please explain to me what I should say to my current "employers/bosses". I am keen not to take any sort of pay cut and currently charge £140 per 24hrs as a maternity nurse does. We have a good relationship but I know they have never considered employing anyone and have always used self employed babysitters/nannies/maternity nurses and that it may be a difficult and unwelcome conversation to have.

I work 24hrs a day, with 2.5hrs off each day similar to a maternity nurse, I have use of a small single bedroom but this is not available in the daytime as has multiple uses (so technically do not have my own room). I see this as a downside and therefore the pay I get in my eyes makes up for that.

They are lovely parents and I am very much appreciated by them, they give me lovely gifts at Xmas and Birthday and also I feel part of the family, so am keen not to burn any bridges!

How would we work it out pay wise, what would they need to pay etc? My National Insurance, My taxes and employers tax. I would then have a contract and finally get paid holidays.

My parents/family have a financial advisor and she says that what I am doing is illegal and therefore I want to sort this asap!

So everyone, advice needed please?

That's hugely bad advice from agency. When they took the nanny money from family they should have got a new contract set up for you that meant you'd be employed.

The family most likely know that its better for them to be self employed as they don't pay holiday pay etc.

I'd simply say to family that on advice from your accountant and HRMC their position does not mean you can be self employed and as such you want a new contract drawn up and to be paid as an employed person with all the benefits.

Also £140 per 24 hours is fairly low pay for a MN unless in the first year or two of MNing.

Hope you get it sorted to protect yourself.

Thank you mrswishywashy great advice.

My plan is to say this to them, I just wanted a few opinions to back up my beliefs, and yes I find the agency quite useless, yet know their fees are extortionate!

I have also pm'd you

Would most say the salary seems good or low, considering I work nights (he mostly sleeps but I have the monitor and am on call as such/in charge) and then 7am-7pm with 2.5hrs off in day. My hourly wage works out low but I honestly thought £140 per 24hrs to be the going rate.

I am however in my second year as a Maternity Nurse, but an experienced nanny. I have my MNT Training.

I think you will find that it is your employers that would be faced with the financial penalties and made to pay back tax when HMRC catch up and recognise that you should not be SE, so I think you could put it to them that you have had this advice and that you are concerned for them and keen to get the situation sorted and the risk removed.

Thank you, I also believed this and as we have a good working relationship I am keen to sort it for both our interests.

This is their first child and therefore maybe they are simply unaware and expect the agency to advice them appropriately

What about National Minimum Wage. 24 hours for 140 is under 6 an hour. There is accommodation offset which may apply, though not sure if it does if you are on-call.

Do you really want to be permanently with this family? Have you got enough other clients coming up to mean that you can leave this client?

I like the family and they really like me, they constantly tell me this. So at the moment I don't feel the want or need to leave. At the same time I thought I was getting a good deal …

Would be keen for others opinions.

I think £140 is low - I've always felt that Maternity Nurse pay is not great when you work it out on a per hour basis, especially with a newborn where you may be up several times through the night.

To put it into perspective, as a daily nanny I earn £125 (gross) for 8am - 6pm.

BumpBirthBaby - I didn't get your PM.

£140 is low for a experienced Maternity Nurse although ok for your first two years as a MN. However you have stayed in the same position so aren't picking up any more newborn skills so maybe £140 is ok if you go back to MN work. When I started I put my prices up by £10 in the first few years every six - 12 months until I've reached £200. I would say that I'm mid range.

Does the agency you use begin with "E"?

I would say that if you are not living with the family the whole week then the pay is very low considering you have to pay tax and that you have to cover your own sick and holiday pay and living expenses for the rest of the week. And also you wouldn't be entitled to redundancy or maternity pay. Being self employed can also influence loans and mortgages. You are very much getting the short end of the deal so hopefully you can work out something with the family to make it fair.

No the agency begins with "T" and something else.

I forgot to pm you, sorry! You have however answered my question.

I do agree, I have missed out on picking up more baby skills, and had to turn down jobs through word of mouth with multiples which I will struggle to get. However I have loved this family/the baby so don't get me wrong there.

What would you suggest I ask for if we are to draw up a new contract in terms of holiday pay (where I will work 6 days a week/possibly 7) and continuous no days off (I could have days off but prefer to work)

Bank holidays?
Sick pay? I have often got ill from the baby and not had any pay
What would I expect to earn for 3 days a week 24hrs
What if they want to go on holiday and I do not wish to?
Would we work out a new rate as hourly, plus an overnight charge?

And i agree.. I am trying to get a morgage, with a healthy deposit and having not much luck.

I'm no good on the fine points of writing contracts and the law regarding employment.

Off the top of my head I'd expect £120-140 net for 24 hours and the days would have to be fixed as that way I could pick up more work or do consulting.

Bank holidays I'm not sure what it would be for a three day week although maybe if you calculated the hours you work that would be better. For me I'd prefer to not work bank holidays and it would be something I compromise with the family at contract talks.

I would discuss with them about holidays and probably charge extra especially if you had to work your "non work" days. If you didn't want to go this would need to be discussed and options given at contract stage. I guess if they were just traveling the days you work then I'd go.

I would do the fixed rate for 24 hours but also add in a hourly rate for extra hours.

If you look back through a few threads there is quite a lot about employment law. Nannynick also knows his stuff too.

honestly this family are taking the piss!!!!

you seem to be in between employed and self employed - as in they pay you gross and you are apparently se, but you dont pick and chose when you work/have time off (the major perk of being se)

they have the best of both worlds, they dont pay you holidays/sick pay and they dont pay employers ni and they pay shit money and why do they need 24hr care? assume baby is now 1yr ish - do they work?

you dont even have a room to call your own

either they employ you, or you find a new family and be a mat nurse and se or find a family and they employ you as a nanny

agree salary is very low and one of the reasons i wont be a mat nurse, but prefer being a night nanny and day time nanny and earn a lot more

Thank you Blondes, I understand where you are coming from, this is however their first child and they have always taken advice from the agency, so in a way I blame the agency for ill advising.

They are a lovely family, I do enjoy my job, the child etc. Hence I am keen to bring this up when I start work this week, being a new year I believe it to be a good time to do so.

The little girl is now 19 months old.
Agree they do not need 24 hr care, far from it, but some people have the luxury of this and although I won't be doing the same myself, nor do I fully approve I think as a nanny/MN we have to accept this. I wouldn't agree to just being a live-in daytime as the accommodation doesn't suit this.

I honestly never thought the pay to be low. And am now wondering what others would suggest, I have to say if I were paid more I would stay longer, which is what they want.

They are both SE but don't work in the way that they are always around, occasionally out and about and working.

They use Nursery otherwise and a SE nanny/nannies for when I am not there.

I agree I would like holiday pay for definite. I this year had to request time off and was luckily given it. Not that I am entitled to it and should be paid

My main concern is losing the family and the job, but I think I would easily find more work as I am well educated, qualified with experience and haven't had a problem before.

I often assumed that parents just do not know the full protocol of employing a nanny OR am I being naive in that they know but hope to save money?

Many thanks

I think your situation is very muddled on both sides.

For them:
This is no longer a temporary situation and they need to either discontinue it or sign up to being employers.

For you:
I think you need to decided whether you want to be a self employed maternity nurse OR an employed (long term) nanny. I suppose you could also choose to be a temporary nanny, but with this family as you have been there too long to be temporary.

If you like this family and want to stay, I think you should suggest some options. Don't go in saying "You are taking the piss and I want it put right!". Do approach them saying you have been advised that you and they are breaking the law; and you are not comfortable with this. Go on to discuss whether you will be live-in or live-out. But I would suggest you want to be clearly one or the other. If you live-out you won't spend your nights there. If you live-in, the room should be yours 24 hours a day. Approach them with some ideas, but don't make any demands at this point.

So are you considering proposing to be a live-out nanny, 3 days per week, working say 12 hours per day?

Could you get the total cost to employer to be similar to what they pay now? That would mean paying you less than they do now though, as currently your fee includes elements to cover holiday, employee taxes, possibly some travel.

They use other SE nannies? Maybe they have no intention of ever having an employee, preferring to have lots of different ad-hoc care... but then why say to you about doing 3 days permanent.

Personally I would look at what your other clients can give you in work and what future clients you can get. If there is not enough work then you need to consider closing your business and becoming an employee for 1 or 2 families who want a full-time or part-time nanny.

19 month old does not really give you maternity nursing experience in my view. Sleep training perhaps but not babycare. If you want to do maternity nursing then I feel you need to concentrate on getting work caring for newborns or those a few weeks to a few months old. Not toddlers.

I had a similar issue following doing the MNT course. Did a bit of night nannying but decided that being a maternity nurse was not want I wanted to do. So I aim for live-out nanny jobs where at least one child is a baby. Sure they grow up but not all jobs last for many years, so once baby grows up you can move on if you feel there is enough demand for nannies with baby experience in the area.

Thank you all. Not too worried about not gaining the experience as such.
Do want to make sure I am on the legal side of things.

Many thanks

The main perk of being self employed (I am SE), is that NI contributions are lower and because you can offset expenses etc, you do often end up paying more tax. So it's likely that if you became employed, you would end up with a lower net salary.

I would try speaking to the agency again, if they insist that you can still be self-employed ask to have it put in writing to protect yourself.

I feel you should negotiate paid holiday at least.

Sorry major typo - you do often end up paying LESS tax..(when SE).

It's not up to the agency to decide if you are se or employed

And if they are advising you to be se for a perm position then thy are also a rubbish unprofessional agency

I'm se and as karoleann said we pay lower ni (think I pay £12 a month) and pay less tax as can claim expenses

But I'm a temp / emergency / night nanny and flit from job to job / family to family

I certainly wouldn't be se working for same family for over a year missing out on smp ssp and holiday as a bare minimum

When are you going to speak to them?

And yes as strix said they may not reliese what they are doing is illegal coz the agency okayed it so go in gently

I am honestly a very polite and kind person so am going to go in kindly with it. I will do it this week, although now isn't the best time for them. I feel it needs to be brought up and then we can all sit down and discuss

I never planned to be permanent hence the SE, and I was a Maternity Nurse for the little girl first, so could be SE. I should not have taken the agencies advice, and feel they are far from helpful anyway.

Many thanks to all.

Just wondering NannyNicks opinion. I was unable to sit down with the family this week. Do you think a letter/email would be acceptable? So they can read in own time? Or is this unprofessional?

A letter via post or email I personally feel is fine. I feel it should outline everything involved and provide reasonable figures for what you feel is the right salary.

However, I feel there are problems such as with National Minimum Wage. Would the parents really pay the required amount? Could accommodation offset be used - not sure, it sounds as though you are on duty 21.5 hours a day (24 hours minus your 2.5 hour break).

If you took your working day as being 21.5 hours, multiply by 3 for the 3 days then that is 64.5 hours per week.

Assuming you are 21 years old or older, then NMW currently is £6.31
So 6.31 * 64.5 = £406.995 So rounding up to £407.

Using MrAnchovey's PAYE Calculator, Employers NI is around £36 per week.

So if just taking those two costs (gross salary + employers NI) the cost to employer is £443 per week.

They currently pay £140 per 24 hour period, so £420 per week. So not a huge jump but it is certainly an increase. Then there is payroll admin cost (say add £150 per year - have a look around at what payroll companies offer, some can be £100), plus then any other costs that may be incurred such as travel on duty, food on duty.

The cost to them will be higher that the amount you currently charge. So you may well find they don't want to do it, even though as the post has become permanent it is what they should be doing.

Set out the figures as per exactly what you work, keeping it all as Gross, so they can see their cost as the employer. Give them details of payroll companies to talk to, so they can get advice from people who know about the tax side of having an employee. Maybe the payroll companies will know if accommodation offset can be used or not... though is not much, so would not lower cost to employer by very much (£14.73 a week perhaps).

What happens if they do not agree... would you then cease providing them with your service, as it is no longer a temporary position? Is it better to seek more temp work and move on?

I want to continue to work for them. I do however if making the position employed and permanent want to ensure I am being paid reasonably.

I have a long commute which is costly and obviously work hard.

Thanks Nanny Nick. Great advice. I do have a student loan, but would need to factor this in as I feel it's unfair they have to pay for that?! Surely that isn't fair on the employers?

Upon the advice given here, I will approach the family with the salary I am willing to accept. If they say no I will have to seriously consider staying on as I could work locally as a daily and earn similar.

I think £140 net per day seems reasonable, looking at£100 for the daytime and £40 for the nighttime, which I've backed up with opinions from fellow mumsnetters! In fact it's the lower end of the scale.

They can't offer me a live in daytime position as to me the accommodation isn't there as I don't have my own room, shared bathroom and I can't stay when I'm not on duty.

So is is where I have calculated that

£140 per day times by three days is £420 net

COST TO FAMILY
£179 per day and a total of £538 a week

So when approaching the family I need to agree on £179 gross pay per 24hours and they then pay my tax, my NI and employment taxes? And a Paye scheme although I should imagine they won't need one.

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MORE QUESTIONS:
What about overtime, I currently get £12 per hour gross if hourly or if a whole day at the normal 24hr rate. Which is fine but how do I get paid this As normally I add it weekly to the invoice. And how does this affect holiday entitlement.

Also I would imagine they'll want me bank holidays on my working days. So do I charge more (I currently charge double) as obviously I'll be employed and not charging, so this needs to be written into a contract. Or if I work them do I not get extra money but extra holiday days??

Many thanks to all for your help!!! More helpful than any agency I've come across!!!

They will need a PAYE scheme.
They will not pay your tax and NI. They will DEDUCT your tax and NI, plus any other deductions like student loan.

Overtime goes on payroll run following the time it is done, so can be several weeks delay. Does not affect holiday entitlement. Shoukd happen rarely, if overtime becomes frequent change working hours and recalculate holiday.

£179 is not cost to employer. Their cost will be minimum £179 plus Employers NI. Plus as they do not currently provide paid holiday, that will be an extra cost to them.